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June 28, 2009 [LINK / comment]

Obama's health care proposals

This past week, President Obama started his big push for health care "reform," setting the stage for what will surely be a monumental battle with the Republicans over the proper role of government. Oddly, Obama has played a passive role as far as the legislative specifics, leaving it up to Speaker Nancy Pelosi and Senate Majority Leader Harry Reid to fill in the details. It's an invitation to chaos and stalemate, which makes you wonder what Obama is up to. I would at least agree with Obama that the current system is a travesty that cannot be sustained much longer. I sharply disagree with most of his proposed remedies, however. From,

President Obama is committed to working with Congress to pass comprehensive health reform in his first year in order to control rising health care costs, guarantee choice of doctor, and assure high-quality, affordable health care for all Americans.

To put it bluntly, that is utopian balderdash. There are always tradeoffs in policy, and by declaring his desire to simultaneously tackle both sides of the dilemma, Obama exposes himself as a light-weight rookie, policy-wise. In the New York Times, David Brooks noted that the Congressional Budget Office has evaluated the two alternative plans put forth by the Democrats, and found that over the next 10 years, they "would cost the government more than $1 trillion this decade and send total health care costs zooming at least twice as fast as the economy as a whole." Obama may not be closely involved with the policy formulation at this stage, but numbers like that reinforce the impression held by many on the Right (including me) that the President is either indifferent to whether the Federal Treasury goes bankrupt, or it actively running that risk so as to create more emergencies that will justify more drastic action. I sure hope I'm just being paranoid about this.

In the Washington Post, George Will writes that most Americans do support health care reform, it's just that they have not really thought about it very deeply: "They want 2009 medicine at 1960 prices." It is a classic case of escapism, or refusing to face up to basic facts. He scorns Obama's fixation on the supposedly excessive share of health care expenditures in the average family budget, but this is as much due to improvements in technology and medical skill as anything. The reason we pay so much is because the quality of our medical care is so high! Maybe what we need, or what some Americans need, at least, is access to lower-quality medical care -- the "barefoot doctors" approach of Cuba or China in the days of Mao. Policies to enhance access to basic-level medical services in public clinics (such as is available in most of Latin America, for example) might be part of a bipartisan compromise solution. George Will gets to the crux of the matter in admirable fashion:

Most Americans do not know this because the cost of their care is hidden. Only 9 percent buy health coverage individually, and $84 of every $100 spent on health care is spent by someone (an employer, insurance company or government) other than recipients of the care. Those who get insurance as untaxed compensation from employers have no occasion to compute or confront the size of that benefit. But it is part of the price their employers pay for their work.

One of the few hopeful signs as this policy debate unfolds is that Obama has indeed begun hinting that he might accept taxes on the (hitherto undisclosed) employer contributions to health care insurance. During the campaign, Sen. McCain boldly took on this issue (see May 2008), but Obama assailed him for it. Now, he realizes that his program will need more revenue, and any government-run health insurance program will fail to attract customers unless that inherent advantage of private health care coverage is eliminated. (NOTE: Former President Bush cautiously addressed this issue in his last State of the Union address, in January 2008.)

Over the next few months, things are bound to get confusing for average folks across the Fruited Plain, as their very lives in the future now hinge upon what a bunch of big shots in Washington decide. Just keep this in mind: All that talk about how many billions this or that proposal will cost or save over the next ten years is a waste of time. Budgetary forecasts are rarely accurate more than a few years in advance, and when it comes to entitlement spending, the sky is the limit. No one really knows how much health care will cost ten years from now. Unless, that is, Obama really is determined to "contain health care costs" by imposing iron-clad caps on costs. That would be a devastating blow to what is left of our market-based economy, and would lead us down on a path toward a paternalistic, semi-authoritarian welfare state.

So what's the Republican alternative approach to health care reform? Beats me.

Obama and Canadian oil

As tensions with Iran mount over the dispute elections and subsequent crackdown against protesters, the question of whether we should reduce our dependence on oil imported from the Persian Gulf rises once again. Well, it seems that the Obama administration has taken "a rather belligerent stance" toward oil extracted from tar sands in Canada for environmental reasons. See Yahoo finance; hat tip to Dan. Apparently Obama is banking on political stability in the Middle East, because a democratic revolution would disrupt oil markets for several months at least. On the plus side, from a parochial standpoint, this shift in policy against oil from tar sands may cause a delay or cancellation of the proposed refinery to built in southeastern South Dakota; see Nov. 29.

NOTE: While looking at my Facebook page on Saturday, I realized to my dismay that I had inadvertently posted a brief and preliminary version of this blog piece on Friday night. My apologies for the (extremely rare) "false start."

Posted (or last updated or commented upon): 29 Jun 2009, 2: 44 AM

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